Forget Solyndra: Obama’s Green Loan Program Is Still Worth It

Nobody’s going to notice this, because nobody’s going bankrupt, but the Obama administration just approved a conditional commitment for the largest residential solar project in history, an effort to install photovoltaic panels on up to 160,000 rooftops at 124 military bases in 33 states. With its $344 million federal loan guarantee, the SolarStrong Project will aim to double the number of solar rooftops in America. I understand why people are freaking out about the spectacular failure of the solar manufacturer Solyndra, which burned through its own loan guarantee; I just think the loan program’s efforts to transform the U.S. energy economy are worth noting, too.

SolarStrong will provide 374 megawatts worth of clean, renewable, domestic power that won’t require the destruction of mountains or the disposal of waste. It will be the largest residential solar project by far, but not the largest rooftop solar project; the administration already approved a $1.4 billion loan guarantee for Project Amp, which will install up to 733 megawatts of solar panels on commercial rooftops in 28 states. The plummeting cost of solar panels was deadly for Solyndra on the supply side, but it’s going to accelerate our transition to a low-carbon economy on the demand side. Solar is getting cheap.

Meanwhile, the loan guarantee program is also backing the world’s largest wind farm in Oregon, the world’s largest solar thermal plant in California, the nation’s first new nuclear plant in three decades—OK, I’m not a big fan of that one—and dozens of other innovative and not-so-innovative projects that will help wean us off fossil fuels. It’s backing $40 billion worth of loans that are creating more than 60,000 private-sector jobs. And some of those loans will go bust. Changing the world requires some risk-taking.

Incidentally, SolarStrong isn’t a government project; it’s being financed by the private equity firm US Renewables Group, which is lending money to the private solar company Solar City, which will sign power purchasing agreements with the private management companies that serve as landlords for our troops. The government is just providing a partial guarantee for 80% of the debt financing, which will reduce the project’s cost of capital. And Solar City has pledged to hire and train veterans and military family members to do the installation work.